Cheaper imports draw customers away from Holden’s locally made Cruze and Commodore models, the company says.

Holden’s managing director, Mike Devereux, lays the blame for much of the Australian dollar’s appreciation at the feet of nations, such as the US and Japan, that have been deliberately devaluing their currencies. “Importantly, the currency plays being made by other countries mean that were are not competing on a level playing field, not even in our own backyard,” Devereux said.

A high Australian dollar makes imports cheaper and exports unattractive. When quizzed about the future survival of Holden’s Australian production and design operations, Devereux said the company was committed to staying in Australia but could offer no guarantees.

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“Mike Devereux, lays the blame for much of the Australian dollar’s appreciation at the feet of nations, such as the US and Japan, that have been deliberately devaluing their currencies.”

A major problem in Australia affecting a wide range of industries.Looks like Overseas investors want to get a good return on their investment, but are nor worried about destroying the Australian economy in the process. As Devereux said the US and Japan are “devaluing their currencies” or “quantitative easing” another way is to say “printing money” to take down their national debts i.e like Weimar Germany in the middle of the Great Depression.

Australia’s high dollar has more to do with Chinese and Russian investors buying land here than anything the japanese do with their Currency , or that America is printing money in the face of historical facts that to do so is always foolish.
It has also a lot to do with the fact that Holden has to pay the lowliest worker $29 hour base rate and it goes up from there.
The Australian dollar may start to droop now that it has been tied to the chinese Currency ,where most of Australia’s mist-like wealth comes from.
I mentioned a month or so back that Gm has been begging money from the Australian tax payer for ever,from 1927 in fact when GM took over the Holden manufacturing company to build Chevys and other GM cars.
it comes as no big surprise that they are going to close down because history has shown us the Mitsubishi/chrysler example in Australia which played out exactly the same.

@Ron.B
Exactly and they have no love for Australia. The Printing of money is extremely foolish, today I heard that Industrial production/employment in the US has been disappointing. You need more effective policies to get the US/Japan out of the hole they are in the moment. Not just printing money.

@Ron B.
It would in the Interests of the Chinese and Russian governments to help destabilize countries like Australia, by allowing the much simpler and more acceptable methods of currency manipulation and investment strategies rather than overt or covert “shenanigans”. The Two countries have similar long term political and economic strategies.

Tempting though it is to blame evil foreigners for one’s problems, it just isn’t so. Australia exports resources and other commodities, and commodity prices have risen sharply since the mid-90’s. This extra income drives up the value of the AUD. Canada, whose exports are also dominated by commodities, has had a similar experience.

When currency values rise sharply, manufacturing will be disadvantaged. When the CAD went from USD 0.63 to parity within only a few years, the manufacturing sector got slammed. No exporting manufacturer can adjust for a 50% increase in costs that quickly, if at all. Neither can a company competing against imported products.

Commodity proces, which declined throughout the 80’s and 90’s, turned with a vengeance starting on 2002.

CAD, AUD and NZD started to rise sharply in 2003. Commodities (especially oil) retreated for a bit in 2007-08, and all 3 currencies fell in value. Commodities recovered in 2008, and all 3 currencies went up again.

Canada, Australia and New Zealand are all developed economies whose exports are dominated by commodities, whether resource or agricultural. This simple fact determines currency rates and national prosperity, and complicates life for manufacturers and service providers, because they cannot control their cost structure relative to foreign competitors.

You’re comparing the U.S with Weimar Germany? That will undoubtedly be preaching to the choir for a segment of our fellow gearheads. And one particular correspondent. Start with a negative G.M. title heading, add a swipe at organized labor for failing to show proper deference to their corporate betters, stir and sit back. Voila. Next, the new TTAC series, G.M DeathWatch. Oh, wait, already done. How about……only Hank Greenberg really understood the bailouts, and had the balls to do something about it?

@olddavid,
Nothing to do with Unions. The economic policy is basically foolish and it is no surprise we are hearing that the unemployment results have been very disappointing.Economic Policies of the US and other National Governments have to be much more effective. Speculative Investors do not really help.

I agree it is foolish. How anyone can believe anything but Keynesian economic theory for financial recession is baffling to me. Spending now while rates are manipulated to historic lows while rebuilding the infrastructure and the resultant workforce resurgence is the only sensible policy. At least this artificial economy could, possibly, be beneficial to someone other than banks and the other “customers” at the Federal Reserve teller “window”.

@olddavid
Which is what should be happening. Unfortunately it is not and a general malaise is taking hold. We have General Elections coming soon in Australia roughly 6 months away and there will be a change of Government, the opinion polls for the current incumbents are terrible.Still a change of Government will give a small boost to the Economy but that is about all.

I’m a dual US/Canadian. Most of my strongest earning years were spent in Canada, so this rise in currency value has benefited me to the tune of 30%. However, I do not want my good fortune to come at the expense of everyone coming after me. If this is the new “normal”, someone smarter than me is going to have to figure out some equitable method to equalize these exchanges. My Father always told me the future is more important than the past. The political classes need to adopt this mantra. What has happened to wanting our children to do better than we did? Is it a lost ideal? I would sacrifice, as should all boomers, if it would benefit the population as a whole – not a privileged elite. The idea that we are all in this together seems lost. Why? Where did all our idealism go?

The AUD has become a psuedo reserve currency even though it is a commodity currency as well. The paragraph below is a cut and paste. Our dollar is being bought by foreign governments as a solid “investment” to hedge against the weaker developed economies.

“As of 2011, the Australian dollar is the 5th most traded currency in the world, accounting for 7.6% of the world’s daily share. It trades in the world foreign exchange markets behind the US dollar, the euro, the yen and the pound sterling.”

The Swiss Franc had this issue with its currency 2 years ago until the Swiss government intervened and reduced its value.

Mining and mining investment is driving the AUDs value as well. I think this will be around for some while. The value might drop, but by not more than 15-20%.

India is slowly coming online as well and will require many of our resources. This is what happens when you live in the most economically dynamic region and have the raw materials to build countries and exports.

Not many people would have heard but a shale oil find around Cober Pedy in SA has the potential to hold as much oil as Saudi Arabia. This find was 2 months ago. The news article stated if the find is only a fraction it is still huge.

Another killer for Australia is our wages. The average wage is now $72 oooUSD. We also have additional cost on our wages like compulsory superannuation contributions etc.

GM’s only hope is to use its GMH division as a potential BMW/Merc/Audi etc challenger like Toyota has done with Lexus.

Australia can then continue with its tradition of building some of the finest rear wheel drive chassis in the world.

“The Swiss Franc had this issue with its currency 2 years ago until the Swiss government INTERVENED AND REDUCED IT’S VALUE”
We are primarily a trading nation. The High Dollar is doing it’s best to stop this from happening. We need Government intervention to devalue the Australian Dollar. All our competitors are doing the same. Unless we do something along those lines we will not have a happy future.

SFR is a unique case, because it is much more of a “haven” currency (tax and political), as reflected in the imprtance of the banking sector in Switzerland’s economy.

Trading nations have no real ability to artificially determine exchange rates, without resort to rigorous foreign exchange control systems – which nobody should want. Interest rate policies can have some effect in the very short term, but these effects don’t last, as they cannot overcome economic factors.

The only factors that will put significant downward pressure on the AUD are either a drop in commodity prices, or sheer bloody incompetence by government that destroys the Aussie economy.

@Ect.
“Trading nations have no real ability to artificially determine exchange rates, without resort to rigorous foreign exchange control systems”
The Australian Reserve Bank is happy at the moment about the Capital Inflows, but others in the Economy are much more worried.

General Motors is committed to Australia. This is their statement.
http://www.abc.net.au/news/2013-04-02/holden-reveals-billions-in-subsidies/4604558
“We’ve received $1.8 billion worth of incentives – both duty reductions and cash – over the last 12 years, and that’s allowed us to undertake automotive manufacturing in Australia and spend over $32.7 billion, and $21 billion of that in the supply of those,” Mr Hobbs said.

“It’s a lot of money to receive but it’s a huge amount to spend in the economy and we’re very, very proud of the fact that we’ve been building cars here and spending a lot of money in the economy.”

The amount averages out to $150 million a year for Holden.

Seems a good value, spend $0.15B to get $2.725B in annual domestic economic activity?

Australia is a socialist state with costs for doing business that leave them little choice but to subsidize the continued existence of a domestic industry.
The US dollar is not weak, and as a matter of economic reality, against logic, I know, we can print at a far higher rate with little to no affect on our low inflation rate.

The AUD is strong. Let me know if you see a plan to devalue it. Mom has a little cash over there. GREAT interest rate.

@doctor olds
A “Socialist State” would bail out its failing car industries like has happened in the US, UK and now France. In the US they actually helped bankrupt entities and in the UK the car companies were nationalized by the Margaret Thatchers Government.The Australian Government will certainly not be doing that.
Cost of doing business here is primarily the high Australian dollar. Subsidized industries that exist in the US i.e Farming do not exist here.
Yes the high interest rates which show strength in the Economy, are also bringing in the speculators that are driving up the Aus dollar.

@DocOlds
For someone who professes to be quite intelligent you have the view that support American Exceptionalism close to your heart.

Believe it or not, per capita of GDP we spend 40% less than the US government. This is why your country is in a mess.

As far as total taxation goes we lie between the US and Canada as a percentage of GDP. US = 27%, Canada = 32% and Australia = 30%. Compare the average Euro country which is between 40% to 50% tax of total GDP.

Also, the Australian economy is the second or third freest in the world, well above the US/Japan/Eurozone countries.

From a social perspective (not welfare) our freedom as a society we are freer than the US ie, topless bathing, abortion issues, censorship etc. We also have guns and hunting, but we are freer to express ourselves.

From a welfare perspective we have one of the best medical systems in the world, yes it is partially public.

Just because it isn’t “American” doesn’t make it Socialist. You are not as free or the freest in the world.

Gentlemen, perhaps “socialist state” was extreme, though it is clearly more so than is the US. More a nanny state as well. My family and I have travelled very extensively and maintained friendships with Aussies for decades. You are assuredly not as free nor as well to do from very many perspectives. I am jealous of RWD Commodore, and Falcon, for that matter. The Commodore’s price is around 60% higher at home than the car can be sold for here in America for one example.

I am not touting American exceptionalism, though, nor meaning offense. I love Australia! Just noting the realities. Costs of most everything are much higher in AU than US. I wondered how you did it and then realized your system depends on a small population for your huge country with large commoditiy exports to tax. The high costs of statist intervention in your economy will make government support for you auto industry an on-going necessity for it to continue, I am afraid.

No hangup. Just descriptive. Socialism does inevitably fail. It requires defiance of human nature with predictable and repeatable results that have been demonstrated many times.
With that said, some level of social support is certainly desirable and appropriate, particularly with the wealth we enjoy today.

“You can not break the rules. You can only break yourself against the rules.”

“Capitalism” fails inevitably. From tulips to flats in Spain. In between there were some banks in the USA and elsewhere. Any idea what the definition of socialism is, or social-democracy? If you don’t know really, just keep quite on some seats in the back.

One unassailable economic reality:
Capitalism, “imperfect” as it may be, has created far more wealth for more people than any other system in the history of the world.
The empirical evidence is overwhelming.

@doctor olds
“it is clearly more than the US”
We have not bailed out any Bankrupt Automobile company yet and unlikely to do so unlike the US

“You are assuredly not as free nor as well to do from very many perspectives.”
Like Big Al from Oz I have extensively traveled the US and found that above quote very representative of the US as a whole.

“Costs of most everything are much higher in AU than US”
Smaller population and subsequently a smaller market, means higher costs.

“The high costs of statist intervention in your economy will make government support for you auto industry an on-going necessity for it to continue, I am afraid.”
OK you have adequately described the US Governments intervention in GM and Chryslers Bankruptcies what do you see for Australia?

@Doctor olds.
We are talking about two different issues. The US Governments Statist intervention in a BANKRUPT GM and Chrysler to make sure the US Economy did not collapse(A good move by my assessment) and the Australian Government providing assistance to Holden. As you stated yourself that assistance has a major multiplier effect throughout the economy.
The costs come from the High Australian Dollar, very different issue when the Australian dollar fell to 80c to the US Dollar then everyone was happy.

Mr Ryan- There really is NO difference other than in your imagination. Both cases are government intervention to prevent the collapse of a strategically important industry. The fact is you Aussies do proportionally more of it and on an on-going basis.
The US situation is different primarily in that it was a one time action in response to factors external to the industry and is unlikely to be repeated.
Most government intervention in America has been hugely harmful rather than supportive of our industry.

@doctor olds
If that massive US Government bailout had not occurred, the US would looking at a Depression not a recession. The cost to the Taxpayers would be unimaginable not $42 per person.
That is the reality. Hopefully the Aus Dollar will eventually go down as the Terms of Trade now is not that favourable.

@DocOlds
I actually read interesting article on American Exceptionalism on the weekend, it was in the Montreal Review, google it.

DocOlds, Australia is expensive if you come here, just like a Mexican visiting the US. Our currency values are different, but its all quite relative.

Costs in Australia are astronomical for a business operator, not from taxes any different from most any other OECD economy including the US. 20 years ago a big push for user pays had arrived as well. That means we don’t have subsidised milk like you do or any agri product subsidised.

We do probably have more social benefits. They are the most targeted in the world, but I rather give the money to who needs it than a failing business or industry. As for public servants we have less per capita, less unionism also than the US.

We do have the most incredible benefit globally, its called the ‘Baby Bonus’, when a kid is born the mother gets $5 000. Some bad decisions have been made with that one.

Look at all the countries with debt problems, they are the most subsidised and protected economies in the world.

It’s our wages versus productivity. Our minimum wage is $33 000USD per year. A 15 year old school kid flipping burgers at Macca’s is on $12.00 per hour. This will flow on.

If our average wage is over $70 000USD then when we buy a car for $35 000 is like you guys paying $25 000. I know a car mechanic and he works for a dealership and he’s on $60 000. I have seen advertisements for truck drivers of road trains in the Top End for $90 000.

But our productivity is being forced to rise and if our dollar devalues we will be quite well prepared. But I can’t see this happening for a long time.

As for freedom, that’s open to debate. We are no different except your society is more conformist and we are like a rich Brazil, layed back.

People working at McDonalds are paid at least minimum wage. It is only bars and sit-down restaurants where minimum wage for servers is lower than the overall minimum wage. Exploitation only occurs when foreign tourists pretend they don’t know they’re supposed to tip.

They’re so exploited that people with resumes come through the doors of local restaurants every hour when there isn’t a job posting. Decent wait staff make far more than the minimum wage here, in fact they tend to pay rent in apartments a few blocks from the beach, own cars, and many of the other things that might constitute a reasonable definition of aspects of earning a living wage. The only ones complaining about the arrangement are statists, who feel they’re being robbed of taxes on the tips.

@danio3834
That is about the lowest paid mechanic/tradesman working for a business.

My friend and work mate has just landed a job. $85 000, that’s under training then it goes up to $130 000 and that’s as a technician. No degree, just a tradesman. Wages are high here as are living costs.

You only need to be a fitter and a tradesman here and that kind of money isn’t uncommon.

Also, any kid under 18 is on a scaled minimum wage starting at around $12ph and then rises to about $600pw (minimum wage).

Having those ‘junior’ wages is good for youth employment and it is training young people to work.

I guess you guys shouldn’t be worried about a few low paying GM jobs then. Australia has essentially full employment according to official figures. Wouldn’t it make more sense to deploy them in profitable industries?

If you think the Australian Dollar has *nothing* to do with mining, I’m not sure how we could find you credible. Certainly people have made a lot of hay over the fact that the Australian Dollar didn’t tank when mining slowed down and that the high Australian dollar has now started to hurt mining (as well as manufacturing and tourism). Some people point to it being a more frequent reserve currency as the reason for this.

However, there’s no guarantee that we don’t go back closer to the norm if the Aussie economy doesn’t pick up and Ms. Gillard is forced to take on more debt to meet the budget. That mining tax thing didn’t work out as intended, and the RBA has been cutting interest rates.

@controllio
Mining has slowed down it is not in a Boom cycle anymore. Coal exports are the same, but the Australian dollar is rising not going down, what you would assume if there was a connection between the two. Investment by speculative investors has been increasing due to the 3 % interest rates.

Four years ago today, the AUD was worth USD 1.0435. Two years ago, it was USD 1.0556. One year ago today, it was USD 1.0318. Today, it’s at USD 1.0433

The AUD is not rising. Its value today is virtually identical to what it was 4 years ago. With occasional fluctuations, it’s trading within a range that reflects the country’s income from trade, and particularly its resource/commodity exports.

“Investment by specualtive investors” is almost never a significant factor over time.

@ect,
Yes four years ago the dollar was down and so was the TERMS of TRADE.
Now the Terms of Trade is going down but the Aus Dollar is going UP.
Now our interest rates as @doctor olds mentioned are high compared to the rest of the world. Good News for him and investors and speculators.

Big Al, no biggie, but I actually live in Canada, whose currency has followed much the same road as the AUD, for, pretty much the same reasons. I am a dual citizen, though.

The US certainly has not only a much larger, but more broadly based economic foundation than either Australia and Canada. Typically, this should mean less fluctuation in the overall economy, even if particular sectors boom or bust.

RobertRyan, you misread my statement. The AUD is not down or up over the past 4 years, it is today exactly where it was 4 years ago.

Terms of trade do matter. A lot. In 2003-2005, Australia”s trade deficit was 3% of GDP. By 2012, the trade surplus was 2% of GDP – due to resource and other commodity exports. Thats a 500 bps swing, which is huge.

In the same period net inflow of debt (i.e. net borrowing from foreign sources, including those evil speculators) went from 5-6% of GDP down to a touch over 2% of GDP.

So, foreign borrowing went down, while the balance of trade went up. And the AUD with it.

My first boss taught me to ignore anecdotal evidence and look at the empirical data. In this case, the numbers speak for themselves.

Interestingly, UBS reports that China now accounts for 85% of Australia’s trade surplus. That’s a very heavy reliance on 1 customer.

@ect,
As Big Al has said there have been fluctuations in the Dollar related to the Terms Of Trade over the years. Economists here are frustrated by the apparent resilience of the Aus Dollar to a downturn in the Terms of Trade. In fact it is defying gravity and going up.

RobertRyan, with respect, the AUD is not rising. It is treading water – that is, trading within a band.

Since 2011, the trading range of the AUD vs. USD has been:

2011: .9653 – 1.0729

2012: .9760 – 1.0747

2013 YTD: 1.0277 – 1.0537.

Today: 1.0423

So, current price is within the trading band of the past 2+ years.

2013 YTD has been barely 3 months, so it’s no surprise that the band is narrower than was the case for full-year 2011 and 2012.

Fluctuations within a short period of time should be ignored. In any thinly-traded currency (which means everything except the USD and EUR, and maybe JPY) it doesn’t take much to shift the supply/demand balance over a day or a week or a month – you have to look at longer periods.

@Ect,
It’s rise is causing a lot of concern here.
This was announced during the week that Reserve was worried about the High Australian Dollar but was not going to do anything about it.
http://www.businessspectator.com.au/news/2013/4/10/interest-rates/rba-changes-tone-high-australian-dollar.

As of yesterday.
http://www.afr.com/p/markets/business_hit_by_new_dollar_peak_kjG1FkZv0OQOQC9R0l8kJJ

As of today
http://www.dailytelegraph.com.au/business/surprise-leap-in-jobless-numbers/story-fn7ki14e-1226618112902

The Australian Dollar is one of the most traded currencies around(do a trip of Europe and see where it is listed as far exchange rates go it is usually just behind the American dollar, Euro and British Pound.
As of the other day it joined the US Dollar and Yen as a currency that can be directly exchanged with the Chinese RMbri.
http://www.theadvocate.com.au/story/1424260/china-courtship-a-win-for-pm/?cs=86

“But in an appendix tucked away in the final pages of a new IMF report on statistics, the fund acknowledged the rising use of the Canadian and Australian dollars as reserve currencies among some central banks. It said a survey of countries found that of the 10 other currencies held in central bank stocks, only the Australian and Canadian dollars are held by more than two countries.
http://online.wsj.com/article/SB10001424127887323353204578129541684589904.html

RobertRyan, it’s not surprising that the Reserve Bank is not willing to intervene in the currency market.

The Bank of Canada made a few attampts to slow the rise of the CAD as it was on its way from USD 63 cents to parity. It was an expensive lesson on trying to stop the incoming tide.

Big Al from OZ, re your comment:

“The trading of the Chinese and Australian currencies will remove the USD from transactions in commodities and value added Chinese imports.

Australian imports (commodities) from China and Chinese imports (manufactured goods) will be cheaper.

This will reduce your financial and commodity markets involvement, which will reduce the US’s influence on price setting.”

I don’t understand. Commodity prices are determined by the law of supply and demand.

Buyers and sellers can negotiate payment in whatever currency they wish. Product prices may be quoted on international exhanges in USD, but a Chinese buyer of Australian coal can agree (and probably already does) to pay in AUD, which he obtains by exchanging CNY for them. No USD transaction involved.

@Robert Ryan–I thought the Margaret Thatcher Government denationalized the British auto industry. I thought one of the great accomplishments of the Thatcher government was to privatise the state owned industries.

I know that at one time the Swedish government owned Volvo and Saab, then Volvo was sold to Ford and Saab sold to GM and now Volvo is owned by Geeley and Saab is gone. British Leyland is no more and the British do not own any of their car industry. Tata owns Land Rover and Jaguar, BMW owns the Mini and Rolls Royce, VW owns Bentley, the Chinese own the rights to the old Rover autos, and Aston Martin is owned by a group of private investors. The history of nationalized or government subsidized auto industry is one of eventually failure of that industry and the home county losing whatever auto industry it had with foreign ownership of that industry. This might happen to GM as well, with Ford possibly being the only remaining US owned auto industry but then again this could happen to Ford as well. I agree with Big Al this is not an ideal practice for government. I fear this is a slippery slope.

@Jeff S. Yes she did start the privatisation of the UK Automobile Industry, but had a “blind spot” when it came to the activities of the “City” the UK finance and banking sectors. The “First Rock” Bank failure predated the much bigger failures that came with the GFC. People did not learn the lesson with that Bank’s failure.
No Volvo was not owned by the Swedish Government nor Saab. They were the car divisions of much bigger private corporations. Volvo and at the time Saab-Scania.

I’m staying out of the Keynesian, Thatcherite, (God Rest her Soul), communist currency manipulation, and free pints and health care economic theories. Is there a realistic chance these 500 workers will ever be hired back?

Ford chose not to build the Focus in Australia for a reason, Toyota stopped building the Corolla in Australia years ago, I doubt that Holden’s business case was much different even with $130m or so from the government to help set up production. They probably should have worked on an SUV with higher profit margins.

I was thinking of the Captiva – or a new generation of that, both a global vehicle and one that would fit in the booming compact SUV segment. Doing their own would likely have poor export potential given the Zeta platform is being orphaned and the market segment is too crowded to generate sales levels of Territory in its early years.

Robert Ryan–That is interesting, I always heard how Thatcher had privatized the nationalized British industries. The Iron Lady was given to political spin as well. Nothing surprises me. I do agree that government loans and/or nationalization of businesses for the most part lesds to failure. I hope the Holden, Opel, and GM NA survive but I do have my doubts.

Robert I guess I misunderstood about Volvo and Saab, but didn’t they get loans from the Swedish government?

Jeff S.
No. The larger corporations had to broken up like Saab-Scania. After selling the car division it became Saab (Aircraft and Military Defence equipment) Scania(Trucks and Marine/Industrial engines). Volvo are the injection of cash from the sale of its car division wanted to takeover Scania and the EU blocked that.

CJinSD
,” in fact they tend to pay rent in apartments a few blocks from the beach, own cars, and many of the other things that might constitute a reasonable definition of aspects of earning a living wage”

No-one in their right mind thinks that waitressing and working as bar staff is a “career choice”. More a supplement to a University course, acting etc. Not fulltime employment. I know people do it full time in the US as they have no other choices

You’re not happy if you think they aren’t making a living wage. If they’re making a living wage, it is confirmation that the US is in a death spiral. Australia must not be the land of milk and honey if you have to focus on the US’s problems to distract yourself from your own. Sorry buddy, but reality is that both our nations are going the wrong way.

@CJinSD
Lost your reasoning on this? just making a comment that is all.
“Australia must not be the land of milk and honey if you have to focus on the US’s problems ”
Now I can AGREE with this.
“Sorry buddy, but reality is that both our nations are going the wrong way.

Thanks Robert for the information. At one time Volvos sold fairly well in the US especially the station wagons. Volvos had a reputation of running almost forever. It sounds like this forced breakup is similiar to a US antitrust action. I see lots of Volvo tractor trucks on the roads. I believe several years ago that Volvo bought White trucks.

I remember either you or Big Al saying about a year ago that Ford could be leaving Australia. Hopefully Holden is able to stay in Australia. The global market has become very competitive and will become even more so. I do understand where Big Al is coming from about the US manufacturers developing globally competitive vehicles, especially in the truck market. It is good to have a global perspective instead of just a US only view.

@ect,
This article explains the problem a bit more.
http://www.macrobusiness.com.au/2013/04/a-new-australian-dollaryuan-nirvana/
It still does not relieve industry of a High Australian Dollar that is having a negative effect on many Trade Exposed industries. I think eventually the Reserve Bank will do more than just drop interest rates. Devaluing the currency like the US/Chinese and Japanese have(dramatically in the case of the Japanese over the last 6 months) by printing more money ,is probably what has to be done.